The market declined today on extremely light volume. The combined influence of the Republican convention, it being the last weekof summer vacations before Labor Day, and the prospect of the monthly employment numbers on Friday, has made the markets very quiet. Friday’s numbers are being looked to by the bulls to confirm that the “soft spot” is over, and of course vice-versa by the bears. Both sides have taken their positions; the chips are down. All eyes are on the croupier as the wheel is spun. As statistician Jim Willie says “However, the reality is that within the US Economy, jobs are produced by statistical models far more than from employers. Over 1.1 million new jobs show up on the Birth-Death model from the Bureau of Labor Statistics, which accounts for over 75% of claimed job growth. On the news, one can see proud claims of job growth, when they are mere estimates from questionable sources. …. The B-D model probably is worthless; it is surely indefensible.”

Of course this makes it very hard to predict what Friday’s number will be. There is ample opportunity for the administration to massage the numbers. Doubtless they will make the most of it, so I would expect a relatively strong number courtesy of the Birth-Death model. This will satisfy everyone and no-one, of course.